Zimbabwe's main opposition say they have reached agreement with the government over the Constitutional Amendment bill, in a surprise move.
Robert Mugabe has ruled since independence
As the draft legislation went before parliament, senior MDC members said they would not attempt to block it.
The constitutional amendments will pave the way for joint parliamentary and presidential elections in 2008.
A spokeswoman for the MDC said: "This should be regarded as a first step in resolving the national crisis."
The MDC told the BBC that positive developments at the South-African backed mediation talks had led to the breakthrough.
Thokozani Khupe, deputy leader of the main MDC faction, said in parliament: "As a confidence-building measure we have made a bold decision not to stand in the way of the constitutional amendments."
The proposed amendments are expected to re-draw electoral boundaries, increase the number of MPs and bring forward parliamentary elections by two years.
The day's political development came as a new report called on the international community to back the regional initiative as the best way forward for Zimbabwe as it falls ever deeper into economic crisis.
Mbeki is under pressure to act more firmly with Robert Mugabe
The Brussels-based International Crisis Group (ICG) says Southern African countries are the only ones with a chance of making a difference as Western sanctions have proved to be largely symbolic and the condemnation of the regime by the UK and US has been counter-productive.
The ICG concludes that all countries and institutions should close ranks behind Thabo Mbeki's efforts to mediate between President Mugabe's governing ZANU-PF and the opposition MDC.
The ICG warned that Zimbabwe is closer to complete collapse than ever, with the world's highest inflation rate at 7,500% and soaring unemployment.
It is estimated that four out of five Zimbabweans live below the poverty line and up to a quarter of the country's population has fled.